The High Cost of Celebrating: A Guide to Combat Overspending During the Holidays

What renders Christmastime a particularly risky moment for rising debt? The answer lies in the way financial and social pressures converge at this time of year.

Across the EU, 17.2 million households and around 40 million citizens suffer from over-indebtedness (European Commission). Rising living costs across Europe, are driving greater reliance on credit, a strain that becomes most visible during the holiday season.

According to ČNB data, the total volume of consumer credit in Czechia has risen consistently each year, particularly since the early-2022 through mid-2023 period, when rising inflation and interest rates accelerated indebtedness. From December 2024 to September 2025 household debt rose by roughly 32 billion CZK—an increase of about 7–8%. Entering January 2025, households already carried more than 412 billion CZK in debt, and borrowing kept rising, indicating that many start the year with substantial financial strain. In the first quarter of 2025, household indebtedness sharply increased by nearly 9 million CZK, which only kept increasing with each passing month. While this pattern cannot be explained solely by Christmas induced debt, we witness a trend: we begin the new year with increased debt and often continue borrowing well into springtime. Data from the Czech Statistical Office shows a seasonal pattern in adjusted (VAT-excluded) sales indices in wholesale trade: a December peak and an immediate decline in January. This indicates that the holiday surge operates across the wider economy, influencing wholesale transactions and supply chains, not only consumer spending.

The data outlined above suggests rising borrowing around Christmas is a symptom of year-round financial pressure. The holidays heighten demand, but the continuous rise in indebtedness points to structural, not temporary, reliance on credit. So, how can we manage the seasonal pressures that arise from this structural dependence on credit?

Quantitative economic data can measure what people spend and borrow, but does not capture the underlying reasons why. Social expectations, emotional consumption, and the intensity of holiday marketing also contribute to intensified financial strain. As consumers, we internalize these omnipresent factors, because that is exactly what corporations depend on for maximizing profit. The holiday marketplace encourages emotionally driven and impulse purchases, normalizes overconsumption, and makes borrowing feel routine—even sensible during the holidays.

As a graduate student in my mid-twenties, when the lights go up and Christmas markets open, I am always reminded how our holiday spirit collides with financial reality. As I navigate the unspoken competition of gift-giving, I often find my rationality yielding to the deceptive voice inside my head that insists, “one more small purchase can’t hurt,” even knowing full well that it will. We associate Christmastime with generosity, and in trying to live up to that ideal, we increasingly stretch ourselves beyond what our bank or credit accounts can bear. The holiday marketplace thrives on its ability to pull us in; we fall into traps without even noticing.

As we continue shopping for the holidays, we must be aware that credit systems vary in design and risk. Some borrowing options support our short-term needs, but many operate to our disadvantage, capitalizing on our stress. High-interest, short term loans often have hidden fees attached. While deferred payment services provided by online shopping platforms (e.g. Klarna, PayU, Skip Pay) are tempting, late payments may lead to expensive penalties. Unawareness is a widespread problem we must address: according to Gen Digital Inc, 30% of Americans intend to use BNPL, yet 46% of that group are unaware of its effect on credit history. Consumers should keep an eye on the enticing but dangerous credit systems that advertise instant loan provisions or promise to “save” Christmas.

To help us manage this, the state could regulate BNPL and other short-term, high-interest credit systems by setting limits on excessive interest rates to protect consumers from predatory lending. Fortunately, the EU’s Consumer Credit Directive (CCD2), adopted in 2023, enhances previous regulation and extends protections to emerging credit systems, including BNPL. Coming into full effect in November 2026, the directive grants consumers greater leniency rights and requires creditors, including BNPL providers, to conduct more rigorous creditworthiness checks.

Policy aside, what can we do for ourselves to remedy our holiday induced stress? Establishing a personalized budget in advance would allow us to stay in control. Seeking guidance from financial advisors or nonprofit counselors can help us budget effectively and steer clear of high-interest borrowing. Tracking spendings as we shop would make it easier to stay within our budgets. If we do use credit systems for support, we should set calendar reminders of payment deadlines to avoid harsh late fees. While tedious, reading the fine print and terms and conditions before signing borrowing contracts can pay off in the long run.

Beyond financial planning, candid conversations with one another may be the most meaningful step we can take. Clearly, so many people feel the same holiday season induced financial anxiety. Are we expressing these feelings out loud? Are we struggling to see financial struggle as a structural issue and internalizing it as personal as a result? If we speak openly about our burdens with those we trust, we might find most people prefer a modest Christmas. After all, the true spirit of the holidays is not found in materialism but in love, care, and connection. We are up against intense market forces, so we must support one another by alleviating social pressure and redefining expectations toward connection rather than consumption.

Living modestly need not reduce holiday joy; it will safeguard us from the emotional and financial pressures that corporations and creditors count on. Realistic budgeting, awareness of risky credit traps, and honest conversations with trusted people may prevent the season from being overshadowed by lingering long-term financial strain and anxiety.